Coping with costly care

Sunday

Aug 25, 2013 at 6:00 AM

By Lisa Eckelbecker, TELEGRAM & GAZETTE STAFF

WORCESTER — Fallon Community Health Plan and two other Massachusetts health insurers are preparing to launch an insurance experiment aimed at controlling the medical expenses of some of the state's poorest, sickest residents.

The insurers, and state officials overseeing the project, are targeting a relatively small group of people — about 90,000 adults age 21 to 64 in nine counties who are covered by both the Medicare and Medicaid government insurance programs.

The goal is to determine whether detailed management and coordination of those patients' health care can tame the outsize bills they ring up. "Dual eligibles," as they are known, accounted for $2.6 billion in medical spending in Massachusetts in 2008.

Yet the wide-ranging needs of dual-eligible patients, and the investments needed to manage their care more closely means savings might not add up immediately.

"This is a pretty complex population," said Mary C. Ritter, president and chief executive of Fallon Total Care, a new health plan for dual-eligible patients that will launch Oct. 1. "We expect that cost savings will improve over time."

Medicare is the nation's health insurance program for seniors and people with disabilities, funded by the federal government. Medicaid, known in Massachusetts as MassHealth, insures people with low incomes. The federal government pays part of the cost for Medicaid, and the state pays the rest.

Both programs are straining public budgets, prompting policy makers to look for ways to rein in spending. One target: dual eligibles.

About 9 million people nationwide receive benefits under both Medicare and Medicaid. Dual-eligible patients made up 20 percent of Medicare recipients in 2008 but accounted for 31 percent of Medicare spending, according to the journal Health Affairs. Dual-beneficiary patients made up 15 percent of Medicaid members but accounted for 39 percent of Medicaid spending.

In Massachusetts, about 35 percent of dual-eligible patients had a serious mental illness in 2008. About 41 percent had chronic physical ailments.

"The individuals participating in OneCare are among the highest cost beneficiaries in both the Medicare and Medicaid programs," said Robin Callahan, deputy director of MassHealth. "Many of these folks have ongoing, day-to-day needs, are receiving services on a daily basis and do not have access to other coordinated care management programs offered by MassHealth."

Massachusetts is one of six states testing ways to better finance medical care for dual beneficiaries under a federal demonstration project. Beginning Oct. 1, three insurers will begin signing up patients for new plans: Fallon, the Network Health arm of Watertown-based Tufts Health Plan, and Commonwealth Care Alliance of Boston.

As of Jan. 1, the state will start assigning dual-eligible patients in four counties, including Worcester County, to plans unless they opt out. Ms. Ritter of Fallon said Worcester County is home to about 14,000 dual beneficiaries who could be eligible for plans.

The plans will receive a set amount of money from Medicare and Medicaid to coordinate all a patient's care, ranging from medical equipment to hospital visits to personal care attendants. Known as "capitation," the payment method differs from the way Medicare and Medicaid now work for patients, by paying a set fee for every service.

Fallon plans to borrow a page from its NaviCare plan, which was created for dual-eligible patients who are 65 and older. Each patient will be assigned a "navigator" — the plan will likely have about 90 navigators — who will coordinate services for that patient.

"This really is about coordination," Ms. Ritter said. As an example, "the primary care physician knows the patient is getting Meals on Wheels, which addresses their nutrition problem, so they don't get dehydrated."

One challenge for the plans is developing networks of primary care doctors, behavioral health professionals, social workers and people or organizations to help patients with daily needs such as transportation, dressing, bathing, eating and shopping.

The availability of providers varies across Massachusetts, and that may have influenced some insurers to stay away from the dual-eligible project, according to Dr. Ronald W. Dunlap, president of the Massachusetts Medical Society.

"The actual support services for this may be important," Dr. Dunlap said. "I think you have to have an adequate number of providers."

Fallon Total Care, which will operate in Worcester, Hampden and Hampshire counties, declined to specify the size of its network. Network Health, which will operate in Worcester and Suffolk counties, has a network of 300 providers so far, including about 100 primary care physicians, plus more than 150 behavioral health professionals, said Deborah D. Gordon, the plan's vice president and chief sales and marketing officer.

"I can tell you that every individual who joins Network Health in this program will have a team of care managers and clinical support people working for them, advocating for them," Ms. Gordon said.

Tara M. O'Connor, executive director of the nonprofit Center for Living and Working in Worcester, hopes that comes true. The center, which advocates for people with disabilities, plans to work with the dual-eligible health plans.

"My fear is that (the plans) may not use all of the services to the fullest capacity," she said. "I should say I would hope they would use all of the services, because I think if we do create a real team directed by the consumer, it could have a very positive impact."

Contact Lisa Eckelbecker at leckelbecker@telegram.com. Follow her on Twitter @LisaEckelbecker.